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journal and explain... a company purchased 3 months of advertising for $2400. Paying a cash down...

journal and explain...
a company purchased 3 months of advertising for $2400. Paying a cash down payment of $240 with the remainder on account.
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Answer #1
Particulars Debit   Credit
Advertising Expense $     800.00
Prepaid Advertismsnt $ 1,600.00
Cash Account $     240.00
Accounts Payable $ 2,160.00
( To Record the Advertmnet Expenses and its payment)

$ 800 (2400/3)has been debited to advertimsent expense for the current month.

$ 1600 (2400-800) has been debited to Prepaid Expenses as it has been prepaid for 2 months and is an asset.

$ 240 has been credited to cash as there is an out flow of cash for payment of advertisment.

$ 2160 (2400-240) has been credited to Accounts payable as it is the outstanding balance payment

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